Regulators and regulatory scholars alike need to keep in mind regulation’s essential human element.
On the occasion of the GW Regulatory Studies Center’s 10th anniversary, I am delighted to offer many congratulations to Susan Dudley and the rest of her faculty affiliates and research team members. As it happens, the key ingredient of the Center’s extraordinary success over the past decade is also the same ingredient pivotal to regulation’s success more generally: people.
People are what regulation is all about and what it takes to make regulation work. For many of us in the field of regulation, this is a point that is too easily forgotten as we get fixated on deep debates over regulatory review procedures and analytical tools.
Regulation is about people in two ways.
First, regulation affects people. It should improve their lives. This basic goal can sometimes get clouded over as scholars and analysts speak in dispassionate, analytic terms. Take the standard terminology of “market failure.” Although it is analytically useful to use this terminology to refer to breakdowns in competitive markets that can justify regulation, the concept of market failure is ultimately just a way to refer to problems that negatively affect people.
For example, one type of market failure—a negative externality—simply refers to environmental harms that affect people’s lives, whether in the form of cancers or asthma from exposure to pollution, or from brush fires, floods, and storms exacerbated by climate change.
Another type of market failure, an information asymmetry, affects real people, too. Consider that an estimated hundred thousand patients around the world suffer debilitating injuries from defective medical devices every year, with thousands reportedly dying from such unsafe devices.
A final market failure—concentration of market power—affects people when companies use excessive power to exploit workers or overcharge customers. Regulation is needed to protect workers and consumers from being taken advantage of by monopolistic firms.
Although regulation affects people positively by tackling real problems and delivering benefits that can improve their lives, it also imposes costs. Even when designed and implemented well, these costs can and do have real effects on other people. And regulation is, of course, not always designed and implemented well.
That recognition, namely that regulation can always do better, points to the second way that regulation is all about people. Ultimately, people make the decisions about when and how to use regulation. People have to design, implement, and enforce regulation. Some of the clearest regulatory accomplishments in U.S. history have come about thanks to courageous, smart people.
For example, Frances Oldham Kelsey, a doctor working on the drug approval files at the U.S. Food and Drug Administration (FDA), held up the drug Thalidomide in the 1960s because she was not convinced its safety had been adequately demonstrated. Her decision turned out to prevent tens of thousands of birth defects throughout the United States.
Consider also the people at the U.S. Environmental Protection Agency and in the Reagan White House who used an analytic tool—benefit-cost analysis—to convince their political superiors that the country had to adopt regulations to eliminate lead as an additive to gasoline. That one regulation has proven to be one of the most beneficial public health measures of all time.
Or think of David Kessler who, when he was Commissioner of FDA, struggled against the tobacco industry to adopt rules that aimed to protect kids from nicotine addiction and cancer. Although the Supreme Court failed to uphold those initial rules, Kessler’s leadership efforts eventually saw success in 2009 when Congress gave FDA express authority to issue these same regulations.
I could continue with still further examples of people who have made regulation work. Most of us go about our daily lives not even conscious of the many dedicated people who are working in government to carry out, follow, and improve regulations that have made our lives better.
But now, what about the future? Most, if not all, of the new kinds of regulatory challenges around the world revolve around new technologies: drones, artificial intelligence, autonomous vehicles, fintech, 3D printing, distributed energy, and much more.
The challenges looming from these technologies perhaps make it seem as if the future of regulation will revolve around things more than people. Indeed, one challenging set of new technologies is literally referred to as the “internet of things.”
But regulating a world increasingly run with these new technologies will still be all about people. Sometimes this will be obvious. Social media, after all, is clearly about people: their online interactions, and their privacy. Even when not obvious, all new technologies affect people, and regulation will be needed to make sure people can benefit from these new innovations while being protected from their harmful effects.
That is where people in government will continue to be crucial. To navigate successfully in a world of new technology, regulatory agencies need to continue to attract top-flight, knowledgeable, high-integrity people—those who also understand technology and rapidly changing industries.
Some of my recent work focuses on ways that regulatory agencies can use artificial intelligence to make smarter, faster, more nimble, and even fairer decisions. But artificial intelligence—or machine learning—still needs people who understand this technology. People will be needed to design algorithms with fair and efficient goals and then to oversee what these algorithms do.
We will need a cadre of knowledgeable regulatory experts to support smart regulation in a technologically advancing economy. This need for human expertise was a basic conclusion that Justice Stephen Breyer came to in the early 1990s, but it will hold an even greater urgency in the years to come.
This need to maintain and strengthen the caliber of people who work in government takes on a special urgency when we read media reports about how the federal government is bleeding scientists. In part, this loss of human capital has to do with the too-frequent debasing of expertise by the current President and others in our contemporary political culture. But it also stems from just plain old demographics. Three years ago, the U.S. Government Accountability Office told us that more than a third of the federal workforce would reach retirement age this year, 2020.
We need to find a way to respond to the current talent out-flow with a new talent in-flow. This is a big challenge.
To meet it, we will need to find ways to lift up the value of public service, not to denigrate it. We will need to fix the political appropriations process to avoid senseless and wasteful government shutdowns. We will need to recruit top workers with strong technical skills, even when the private sector can offer them a lot more money.
Ultimately, society in the future wins only when the regulatory workforce of tomorrow will be smarter than ever before. Regulators will need to understand new technologies and respond to new risks in cost-effective ways.
The future also demands a regulatory workforce that will be as committed as ever to the rule of law and to service in the public interest. We will need a workforce that listens well and knows how to engage the public empathically. But we also will need one that possesses the confidence and courage to make difficult decisions and then make them stick.
At the same time, regulators—and public leaders more generally—must possess genuine humility and seek constantly to learn what works, and what does not, and to keep on improving.
And this brings me back to the GW Regulatory Studies Center at the Trachtenberg School of Public Policy and Public Administration at the George Washington University. This Center and the great university within which it resides is exactly the kind of place where many people can and do come to learn the skills needed to regulate better.
For all those students at the George Washington University and elsewhere who are interested in careers in regulation, my concluding message to you is clear: Take advantage of the excellent resources and opportunities you have available to you to prepare to be the best professionals you can be. In the end, people are counting on you.
This essay draws on the author’s keynote address at the recent 10th anniversary conference, “From Prohibition to Flying Cars: The History and Future of Regulation,” held at the GW Regulatory Studies Center.